Nebraska voters face six statewide questions in November.
Two are constitutional amendments proposed by the Legislature. Amendment 1 would prohibit enslavement as punishment for crime. Amendment 2 would extend repayment of TIF debt for “extremely blighted” areas.
Four are statutory initiatives proposed by the initiative petition process. Initiative 428 proposes to limit payday lending interest limits. The other three — initiatives 429, 430 and 431 — would allow casino gambling at licensed horse racetracks and establish regulation and taxation of the casinos.
Proposed Amendment 1
Proposed Amendment No. 1 prohibits the use of slavery or involuntary servitude as punishment for conviction of a crime. Nebraska prohibited slavery and involuntary servitude in 1875, except as punishments for those convicted of crimes. A similar situation exists in 11 other states, and nine states permit involuntary servitude but not slavery as criminal punishment.
A “yes” vote supports removing the language from the Nebraska Constitution.
A “no” vote would keep the language in the state constitution and allow the use of slavery and involuntary servitude as criminal punishments.
Proposed Amendment 2
Proposed Amendment No. 2 would amend the Nebraska Constitution to allow the Legislature to extend the maximum amount of time for the repayment of indebtedness related to tax increment financing from 15 years to 20 years if more than one half of the property in the project area is designated as extremely blighted.
Tax increment financing is intended to finance economic development in an area. In Nebraska, the governing bodies of cities and villages can enact resolutions to declare an area as substandard, blighted and in need of redevelopment, and create a TIF district. The local government can then issue bonds to finance improvements associated with redevelopment projects in the district.
Local governments can use increased tax revenue, resulting from increased property values due to development, to pay off the bonds over a 15-year period. The ballot measure would increase the period to pay off the bonds and indebtedness from 15 years to 20 years for TIF districts designated as extremely blighted. In Nebraska, an extremely blighted area is defined as a census tract with an average unemployment rate that is 200% or more of the average state unemployment rate and the poverty rate is more than 20%.
A ”yes” vote supports the extension of the repayment period for tax increment financing from 15 to 20 years for areas where more than one-half of the properties are designated as extremely blighted. A “no” vote would keep the repayment period at 15 years.
Nebraska Initiative 428 is the first of four issues placed on the ballot through the initiative petition process. It is intended to amend Nebraska statutes covering the amount that delayed deposit services licensees can charge to a maximum annual percentage rate of 36%. It would also prevent these entities, commonly known as payday lenders, from evading the rate cap and deem void and uncollectable any transaction made in violation of the rate cap.
Under current statute, delayed deposit licensees are prohibited from charging fees in excess of $15 per $100 loaned. The proposed measure would replace that with a 36% annual limit on payday lending transactions. Current law limits the loan amount to $500 and loan term to 34 days.
Initiative 428 would also prohibit payday lenders from collecting fees, interest, or the principal of the transaction if the rate charged is greater than 36%. Payday lenders are also prohibited from marketing, offering or guaranteeing loans with interest rates exceeding 36% in the state regardless of the lender having a physical office in the state.
Currently, 37 states permit payday lending. Colorado, Montana, New Hampshire and South Dakota have enacted 36% annual interest rate caps that also prohibit additional fees or charges. Four states authorize payday lending with limits on APR, but permit lenders to charge extra fees on top of interest. The remaining 29 states authorize payday lending without limits on APR.
A “yes” vote supports limiting the annual interest rate charged for delayed deposit services to 36%. A “no” vote maintains existing state law on payday lenders, including a prohibition on charging fees in excess of $15 per $100 loan and a $500 loan limit.
Casino gambling initiatives
Three ballot issues from the initiative petition process cover casino gambling at licensed Nebraska horse racing tracks, the regulation and taxation of that activity and the distribution of the proceeds. They are: Initiative Measure 429, a proposed constitutional measure allowing casino gambling at licensed horse race tracks; Initiative 430, a proposed law setting up a regulatory framework for the casinos; and Initiative Measure 431, a proposed law to tax the casinos and direct most of the tax revenues to property tax credits.
It took a ruling from the Nebraska Supreme Court to clear the measures for the ballot. It’ll take a minute to grasp the domino effect of the three-part proposal. Initiative 429 would allow for the enactment of Initiative 430, which would authorize and regulate gambling at licensed racetracks, and Initiative 431, which would impose an annual tax of 20% on gross gambling revenue of licensed gaming operators. Without the approval of Initiative 429, Initiatives 430 and 431 would not take effect.
Nebraska Initiative 429
Nebraska Initiative 429 would add a new Section 24 to Article III of the state constitution to exempt laws authorizing gambling at licensed racetracks from the state’s constitutional prohibition on gambling. Currently, the Nebraska Constitution prohibits gambling, except for the state lottery, which was authorized in 1992, and authorized raffles intended to raise proceeds for charitable causes.
Revenue raised from the lottery is allocated to the Compulsive Gamblers Assistance Fund, the Nebraska Environmental Trust Fund, the Nebraska State Fair Board, and the Legislature to fund education.
Gambling in some form is legal in 48 of the 50 states, with Utah and Hawaii completely banning it. Twenty-five states have legalized commercial gaming and 30 states have authorized tribal casinos.
Three other states will be voting on measures concerning gambling. Colorado would allow local jurisdictions where gambling is legal to approve a maximum single bet limit of any amount and expand allowable game types in addition to slot machines, blackjack, poker, roulette and craps. A second Colorado amendment would lower the number of years an organization must have existed before obtaining a charitable gaming license from five years to three years.
Maryland would authorize sports and events wagering at certain licensed facilities with state revenue intended to fund public education. A South Dakota constitutional amendment would authorize the South Dakota Legislature to legalize sports betting within the city limits of Deadwood.
A “yes” vote supports amending the Nebraska Constitution to allow laws to authorize, regulate, and tax gambling at licensed racetrack facilities in the state.
A “no” vote opposes amending the Nebraska Constitution to do those things and would maintain the state’s prohibition against gambling at racetracks.
Nebraska Initiative 430 would authorize gambling at licensed racetracks with licensed gaming operators. It would establish the Nebraska Gaming Commission to enact rules to license gaming operators and regulate the gambling industry. The measure would prohibit anyone under the age of 21 from playing on gambling devices or participating in gambling at the racetrack. Currently, Nebraska outlaws gambling, except with respect to the state lottery, licensed raffles, and bingo.
A ”yes” vote supports enacting a law that authorizes gambling operations within licensed racetracks and establishes the Nebraska Gaming Commission to regulate gambling operations.
A “no” vote opposes enacting a law that authorizes gambling operations within licensed racetracks and establish the Nebraska Gaming Commission to regulate gambling operations.
Nebraska Initiative 431 would authorize the Nebraska Gaming Commission to collect a 20% tax on all gross gaming revenue generated within licensed racetracks. Gross gaming revenue is defined as the amount of money players gamble minus the amount won, federal taxes and any promotion gaming credits received from the operator and redeemed by the player.
The revenue from the tax would be allocated as follows:
» 2.5% to the Compulsive Gamblers Assistance Fund.
» 2.5% to the General Fund.
» 70% to the Property Tax Credit Cash Fund.
» 25% to local jurisdictions where licensed racetracks operate.
The Nebraska Gaming Commission would be authorized to develop rules for reporting revenue from the tax, and gaming operators that do not comply would receive a maximum penalty of a Class IV misdemeanor.
A “yes” vote supports imposing the tax and distribution as outlined.
A “no” vote opposes the tax on gross gambling revenue of licensed gaming operations.
This report by J.L. Schmidt is made possible by the Nebraska Press Association. Schmidt has been covering Nebraska government and politics since 1979.
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